Law school launches college for corporate board directors

STANFORD -- The chairman of the U.S. Securities and Exchange
Commission (SEC), the presidents of the New York Stock Exchange and the
Nasdaq Stock Market, and a judge who has made more pivotal decisions in
matters of corporate law than any other individual jurist will speak at
Stanford Law School March 23-24 at Directors' College, a new program for
members of corporate boards.

They, as well as other leading business people, jurists, regulators and
scholars, will discuss how directors can better execute their
responsibilities - to the corporations they serve, to their
stockholders and to employees - while avoiding the legal liability
that can accompany board service. The two-day program will offer hands-on,
practical advice in such areas as responding to shareholder activism,
reacting to takeover bids, avoiding allegations of fraud and managing
derivatives - the controversial financial instruments that cost
Procter and Gamble, Gibson Greeting and others losses of hundreds of millions
of dollars.

Directors' College is the first executive education program offered by a
major law school, tailored specifically to the needs of directors of publicly
traded corporations. It will feature keynote addresses, plenary sessions and
a series of problem-oriented breakout sessions designed to address
real-world, board room issues.

The impetus for Directors' College came from Stanford Law School Professor
Joseph Grundfest, a former SEC commissioner whose fields of expertise span
corporate law, securities regulation and finance.

"Knowledgeable, well-informed directors add value to the corporation and
help control the risk of litigation," Grundfest said. "A well-informed
director is a good director."

Grundfest called the increased responsibility of corporate board members
and individual directors' liability "mind boggling," and described disclosure
obligations as "numbing." Directors must oversee risk management systems that
include derivatives - potentially risky investment vehicles with
which most directors have little experience - and other exotic
instruments. Their activities in takeovers are also scrutinized with greater
intensity. In addition, the specter of litigation forces each director to
face the potentially incriminating question, "What did you know and when did
you know it?"

Yet, until now, "There has been no regular forum for directors themselves
on the latest, cutting-edge issues that affect performance as a director,"
Grundfest said.

The faculty for Directors' College consists of many of the nation's
leading business people, academics and regulators. The Hon. William T. Allen,
Chancellor of the Delaware Court of Chancery, for example, is "a leading
intellect in terms of defining directors' responsibilities" and has great
influence over the course of corporate law in Delaware. More than 90 percent
of the capital value of U.S. firms is held by corporations chartered in
Delaware, Grundfest said.

Keynote speakers include Richard A. Grasso, president and chairman
designate of the New York Stock Exchange, on Wednesday evening, March 22; SEC
Chairman Arthur Levitt on Thursday, March 23, at noon; Joseph R. Hardiman,
president of the Nasdaq Stock Market on Thursday evening, March 23;
Chancellor Allen on Friday, March 24, at noon; and the Hon. Steven Wallman,
SEC commissioner, on Friday evening, March 24.

Four plenary sessions are scheduled:

"Board Governance, Board Composition and Shareholder Activism" will review
the latest proposals for governance reform. It will consider recent events
that are likely to affect board operations, including General Motors' and
Campbell Soup's board guidelines, the dispute between Philip Morris'
management and certain large institutional investors, and institutional
investors' practice of targeting certain boards and managements that appear
to have under-performed.

"The SEC and the Director" will discuss the directors' role in ensuring
compliance with federal securities laws, including insider trading issues and
disclosure matters. In the event of a violation, federal penalties coupled
with the threat of civil or criminal liability may place a heavy personal
obligation on the individual director. Senior officials of the SEC will
review securities law provisions that are particularly relevant to corporate
directors.

"Takeovers and the Director" will assess the directors' duty, not only to
shareholders, but to employees, bondholders, retirees and other
constituencies. Recent rulings in takeover transactions create new challenges
and ambiguities for corporate directors. The faculty, including the
Chancellor of Delaware's courts, two of the nation's leading takeover lawyers
and a CEO who actively defended against a hostile takeover, will discuss what
to do when the corporation receives an unsolicited takeover bid, and what to
do when a third party offers a higher bid after a merger agreement has been
reached.

"Directors and Derivatives: New Financial Instruments and Other Traps for
the Unwary" will look at the risks associated with derivatives exposures.
Experts will discuss what directors need to know about derivatives markets if
they are to fulfill their oversight responsibilities, and will present
practical steps that directors can implement to control derivatives risk.

Program participants will have the opportunity to attend four of five
breakout sessions, offered on "The Audit Committee," "Litigation,
Indemnification and D&O Policy Coverage," "Management and Director Succession
and Continuity - The Nominating Committee and Beyond," "Compensating
Executives and Directors" and "Compliance Programs, Special Investigations,
and the Independent Director."

Attendance is geared toward board members of publicly traded corporations,
and their attorneys and corporate secretaries. Cost for the two-day program
is $2,850 per person. For registration and information, call (415) 723-0981
or fax (415) 723-0253.

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